The fund aims to provide a combination of capital growth and income while considering environmental, social and governance (ESG) factors, and seeks to achieve a higher ESG rating than the global high yield market.
Investment policy and strategy
Core investment: At least 80% of the fund is invested in lower quality bonds, denominated in any currency, and issued by companies from anywhere in the world, including emerging markets.
The fund’s currency exposure is typically hedged back to US dollar.
The fund invests in securities that meet the investment manager’s assessment of environmental, social and governance (ESG) criteria. Companies deemed to be in breach of the United Nations Global Compact principles and/or involved in defence and weapons are excluded. Investments in companies involved in industries such as tobacco and nuclear power are restricted.
Other investments: The fund may also invest in asset-backed securities, contingent convertible debt securities and cash or assets that can be turned quickly into cash.
Derivatives: The fund may invest via derivatives and use derivatives to reduce the risks and costs of managing the fund.
Strategy in brief: The investment approach is based on an in-depth analysis of corporate bonds and their issuers, combined with an assessment of macroeconomic factors such as economic growth, interest rates and inflation. Spreading investments across issuers, industries and countries is an essential element of the fund’s strategy. ESG criteria are assessed as part of the credit analysis of bond issuers, and act as an additional filter to the fund’s exclusion policies.
Benchmark: ICE BofA Merrill Lynch Global High Yield USD Hedged Index
The benchmark is a comparator against which the fund’s performance can be measured. The index has been chosen as the fund’s benchmark as it best reflects the scope of the fund’s investment policy. The benchmark is used solely to measure the fund’s performance and does not constrain the fund's portfolio construction.
The fund is actively managed.The investment manager has complete freedom in choosing which investments to buy, hold and sell in the fund. The fund’s holdings may deviate significantly from the benchmark’s constituents.
For unhedged and currency hedged share classes, the benchmark is shown in the share class currency.
You can find more information about the objective and investment policy of the fund in the Prospectus.
Risks associated with the fund
The value and income from the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise. There is no guarantee that the fund will achieve its objective and you may get back less than you originally invested.
Investments in bonds are affected by interest rates, inflation and credit ratings. It is possible that bond issuers will not pay interest or return the capital. All of these events can reduce the value of bonds held by the fund.
High yield bonds usually carry greater risk that the bond issuers may not be able to pay interest or return the capital.
The hedging process seeks to minimise, but cannot eliminate, the effect of movements in exchange rates on the performance of the hedged share class. Hedging also limits the ability to gain from favourable movements in exchange rates.
In exceptional circumstances where assets cannot be fairly valued, or have to be sold at a large discount to raise cash, we may temporarily suspend the fund in the best interest of all investors.
The fund could lose money if a counterparty with which it does business becomes unwilling or unable to repay money owed to the fund.
Further details of the risks that apply to the fund can be found in the fund's Prospectus.
The performance webpage for this fund is currently being reconfigured. In the interim, for performance information, please refer to the latest Fund Factsheet which can be found in the Literature section.